The Associated Press's Jamie Aron reported that Mike Modano told ScoreBoard Monthly magazine that he's officially signing a one-year contract with the Red Wings. As I had not yet heard of the publication, I looked it up, and, voila, a one-on-one interview with Modano:

August 3, ScoreBoard Monthly:ScoreBoard: So after much thought and I’m sure
sole-searching it appears you’ve made a decision on your career – so are
you going to accept the offer from the Red Wings and play another
season?

Modano: Yeah, it was a lot of back and forth internally
but I ultimately decided I wasn’t ready to hang up the skates so I’m
going to Detroit.

...

ScoreBoard: Your buddy Brett Hull wasn’t offered an
extension with the Stars after the 2000 season and went on to sign and
win another Stanley Cup with the Red Wings. Did he or anyone in
particular influence your decision to play another season? If so was
there something in particluar they said that swayed you to play again?

Modano: Not really anything in particular. I did talk
to Brett and some other past and present Red Wings and it made me feel
very comfortable with my decision. They all told me what a great
organization and city it is to play in. And mix in the incredible
talent they have playing there and it kind of made my decision for me.

ScoreBoard: Being a Michigan native does it feel like you’ve come full circle to play for the Red Wings?

Modano: Absolutely. And going to an original 6 team
that has such an incredible history, and one that I grew up being a fan
of is something special.

Modano does say that he still plans to return to Dallas when his playing career is over, and as of yet, he's not sure what number he'll wear. I'm guessing that St. James' bet on #90's a solid one.

August 4, Macomb Daily: Modano, who is on a golf outing in Scotland, also told The Dallas
Morning News that he’s scheduled to arrive back in the United States at 6
p.m. Thursday. No one in the Wings’ front office would confirm that Modano is indeed coming to finish his career in Detroit.

“I’m optimistic,” Wings general manager Ken Holland said. “Our
conversations have been good, but you never want to say it’s 100-percent
until you know for sure. We all think it’s a great fit. We think it’s a
great fit for a lot of reasons.”